Which statement about the master budget is not typically included?

Which statement about the master budget is not typically included?

• A. A cash budget
• B. A budgeted balance sheet
• C. A detailed marketing plan
• D. A budgeted income statement

Answer: (C)

When preparing a master budget, the aim is to translate the planned operations into a complete financial forecast for the period. It brings together the financial plans that show how the business will generate and use cash, what its profitability will look like, and what its projected financial position will be. The typical components are the cash budget, the budgeted income statement, and the budgeted balance sheet, along with supporting operating budgets such as sales, production, materials, and selling-and-administrative costs. A detailed marketing plan, however, is a strategic, non-financial document that outlines marketing objectives and tactics. While the marketing activities influence the budgets (for example, marketing expenses appear in the selling-and-administrative budget), a separate, detailed marketing plan isn’t itself a standard part of the master budget.

When preparing a master budget, the aim is to translate the planned operations into a complete financial forecast for the period. It brings together the financial plans that show how the business will generate and use cash, what its profitability will look like, and what its projected financial position will be. The typical components are the cash budget, the budgeted income statement, and the budgeted balance sheet, along with supporting operating budgets such as sales, production, materials, and selling-and-administrative costs. A detailed marketing plan, however, is a strategic, non-financial document that outlines marketing objectives and tactics. While the marketing activities influence the budgets (for example, marketing expenses appear in the selling-and-administrative budget), a separate, detailed marketing plan isn’t itself a standard part of the master budget.